MARK ARBIB, EMPLOYMENT-PARTICIPATION MINISTER: The economy is still very fragile.

PHILIP LASKER: And the Opposition's playing it up.

HELEN COONAN, OPPOSITION SPOKESWOMAN: it's a recession that never was.

PHILIP LASKER: The job's market suggests it was a recession that barely hit. Even though more people joined the search for work in September the national unemployment rate edged lower, from 5.8 to 5.7 per cent, when most analysts expected it to reach 6 per cent.

More than 40,000 jobs were created, the biggest monthly rise in nearly two years, with an overwhelming switch from part-time to full-time work. It saw the number of hours worked increase for the first time in a year. Unemployment fell in NSW, the ACT, Victoria and South Australia. It was steady in the Northern Territory, but the rate jumped to six-year highs in the resources states of both Queensland and Western Australia.

With unemployment fairly flat for months, analysts were wondering if the jobless rate had peaked.

MICHAEL BLYTHE, COMMONWEALTH BANK, CHIEF ANALYST: We've now had four months in a row where we've sort of held around that 5.75 per cent mark, and it kind of looks like a top is forming then. But the population's growing strongly - we need to generate about 20,000 new jobs every month to stand still in terms of unemployment. So it's probably a little bit too soon to rule it off and say we have peaked.

PHILIP LASKER: But the peak will be well short of the Government's 8.5 per cent budget forecast. Despite that, its focus was on those still unemployed and the continuing problems offshore.

MARK ARBIB, EMPLOYMENT PARTICIPATION MINISTER: So the Government believes we must continue with the stimulus package; continue to support jobs; continue to support small business.

HELEN COONAN: When an economy is shrinking you can put money in. When an economy is expanding, you take stimulus out.

PHILIP LASKER: In the eyes of analysts, today's numbers mean the Reserve Bank will take a more aggressive approach to removing its stimulus by increasing interest rates.

MICHAEL BLYTHE: Our markets have now priced in a rate rise after the November board meeting as a 100 per cent certainty.

ALAN OSTER, NATIONAL AUSTRALIA BANK, CHIEF ECONOMIST: We would expect that the Reserve will go again another 50 points by Christmas. We've pencilled in November and December.

PHILIP LASKER: Many households will be pencilling in changes to their budgets - the major lenders will start increasing variable home mortgage rates from next week.

The big four banks fell into line with the Treasurer's wishes and the Reserve Bank's move, increasing their variable home mortgage rate by 25 basis points.

The numbers also gave the Australian Dollar another significant boost; it's trading well above 90 US cents.